|Extent of IFRS application||Status||Additional Information|
|IFRS Standards are required for domestic public companies||IFRS Standards as adopted in Korea (which are IFRS Standards as issued by the IASB Board without modifications) are required for listed companies and financial institutions.|
|IFRS Standards are permitted but not required for domestic public companies|
|IFRS Standards are required or permitted for listings by foreign companies||Foreign listed companies are permitted to use (a) IFRS Standards, (b) IFRS Standards as adopted in Korea, or (c) US GAAP.|
|The IFRS for SMEs Standard is required or permitted||No. However, SMEs are permitted to use full IFRS Standards.|
|The IFRS for SMEs Standard is under consideration||No.|
The KASB plays the following two roles depending on the category of companies on which accounting standards are enforced:
Unlisted companies may opt to apply IFRS Standards.
June 2016 evaluation of IFRS Standards in Korea
In June 2016, the Korea Accounting Standards Board published a report of its evaluation of the adoption of IFRS Standards after five years of use. Overall, the study found that IFRS Standards have had a positive impact on international financing for Korean firms.
The research also shows that although accounting-related costs have increased for local firms and companies, the local preparers and users of financial statements have identified positive effects from IFRS adoption, including:
The report of the evaluation is available on the publications section of the KASB's website.
All of the following are used in audit reports of large Korean companies:
The KASB translates every IFRS Standard issued by the IASB into the Korean language. The translation is drafted by the KASB staff and then exposed to the public with invitation to comment after approval by the KASB. The KASB carries out investigations into any issues that may concern the government, ie the Financial Services Commission (FSC), who is to make a final decision on the endorsement of the translation of the IFRS done by the KASB. Once the translation of the IFRS Standards is endorsed by the government, it is integrated into the domestic legal framework. The procedure may be summed up in the following sequential steps:
South Korea has added a presentation requirement to IAS 1 Presentation of Financial Statements to require disclosure of operating profit or loss on the face of the statement of profit or loss and other comprehensive income.
Korea has added to IAS 1 a requirement to present a Statement of Appropriations of Retained Earnings. This requirement was added to IAS 1 to be aligned with the Commercial Law.
South Korea has added a disclosure requirement to IAS 11 and IFRIC 15 (Blue Book), and IFRS 15 and IAS 37 (Red Book) which requires entities to provide additional disclosures relating to recognising revenue under the percentage of completion method when using the particular method set out in paragraph 30 (a) of IAS 11 Construction Contracts (the so-called 'cost-to-cost' method). The additional disclosure requirement is applicable to a listed entity when the entity’s contract revenue in the preceding year exceeds a certain level. Such entities are required to provide more detailed disclosures of each contract and additional disclosures about the operating segment.
Korea has renumbered the standards as follows: